Workers to vote on Holden's future

THE fate of car maker Holden is in the hands of its 1700 Adelaide assembly workers.

The workers will vote next week on a new enterprise agreement designed to save the company $15 million a year in labour costs.

Australian Manufacturing Workers Union state secretary John Camillo says if the workers reject the plan Holden has made it clear the assembly operations in Australia will close from 2016.

He said the company requires both the new enterprise agreement and the federal government's financial support, thought now to be close to $500 million, to continue as a local car producer.

"Holden has made it quite clear that if workers reject the variation they have decided to close the operations down in 2016," Mr Camillo told reporters on Thursday.

"There's no plan B in this one. The workers will make a decision and if it's a no, the company will close."

The new labour agreement does not include the 10 per cent pay cut the company initially called for but does allow Holden more flexibility on a range of measures including cutting production for short periods in response to market demand with workers taking annual or other leave to top up their pay packets.

It will also cap redundancy payments for new staff, save the company money on income protection insurance and provides for new shift arrangements.

The new deal was presented to workers on Thursday and will be put to a vote on August 9.

It will only require a simple majority of workers to accept or reject it.

Holden said it did not intend to publicly discuss the details of the new agreement until its workforce had time to read and absorb it.

But a spokesman said it included some tough measures to deliver necessary cost savings and productivity gains without the need for wage cuts.

"From the outset of these discussions, the company's aim has been to minimise or remove wage cuts," the spokesman said.

"The cost savings outlined by the company will be achieved through a combination of labour-related savings, productivity and flexibility measures."

Mr Camillo said Holden chairman and managing director Mike Devereux had assured workers that provided they agreed to the new deal and provided the company could secure federal government assistance, it would proceed with the replacement cars for the current Cruze and Commodore models from 2016.

He said that would secure production in South Australia until 2026.

Union officials will consider the proposed agreement over the next few days before making a recommendation to workers.

He said the mood in the plant was probably 50-50 in favour of approving or rejecting the deal.